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Money Magazine asks the question:

A recent study by Goldman Sachs Asset Management concluded that while over 15 years a human manager can beat a quant fund in absolute terms, once you adjust for the extra risk the human manager had to take to get that result, the quant fund comes out ahead.

"Quant funds are a well-established strategy for institutional investors," says Coral Gables, Fla. financial planner Harold Evensky. "They are becoming a story for individual investors, and for most people they probably make good sense."

I'm a little skeptical. Computers are only as smart as the people doing the programming. My guess is that computers do well because they don't have emotions. Vulcans, I'm sure, would make kick-ass money managers. Still, I'll go with us humans, imperfections and all.

Posted by edelfenbein at April 24, 2006 4:00 PM